Binance CEO Summoned by Nigerian Authorities Amidst $10B Fne

• Nigeria demands $10 billion from cryptocurrency exchange Binance, accusing it of profiting from “illegal transactions” and manipulating the local currency.
• The Central Bank claims Binance facilitated $26 billion in untraceable outflows, contributing to the naira’s poor performance.

Binance continues to grapple with escalating regulatory challenges. In Nigeria, reports have emerged that CEO Richard Teng has been summoned to appear before the Nigerian House of Representatives Committee on Financial Crimes over suspicion of money laundering and terrorist financing. Furthermore, the government has summoned Binance executives to appear before the finance committee.

According to local media reports, the committee’s chair, Ginger Onwusibe, has issued a stern warning to the Binance executive that if Binance ignores the summons slated to happen on or before March 4, 2024, the committee will exercise its constitutional authority and take the necessary actions.

Onwusibe further highlighted the committee’s commitment to combating financial crimes,  reiterating that the constitution empowers them to safeguard Nigerians from financial crimes, particularly those involving foreign companies. He further expressed disappointment at the Binance Excec for not attending previous invites despite multiple invitations. The recently appointed CEO Richard Teng was first invited by the committee to appear on Dec. 18, 2023. 

Binance Faces Increased Scrutiny From the Governments

This summons comes at a time when the company is facing increased scrutiny from the government. Earlier last week, reports emerged that the Nigerian government is claiming $10 billion as compensation from Binance. According to a statement from Bayo Onanuga, Nigeria’s President Bola Tinubu’s special adviser, in an interview with the BBC, Binance profited from “illegal transactions” at the country’s expense.

In the interview, Central Bank Governor Olayemi Cardoso said that Binance had enabled $26 billion of untraceable funds to leave the country, all this while the country is facing a foreign exchange crisis and is looking for ways to restrict capital outflows. In recent months, the naira has hit record lows, weakening over 70% against other currencies. 

Stepping up the pressure, special advisor Onanuga further accused Binance of manipulating the market by artificially capping the selling price of Tether (USDT) for the Nigerian Naira. He emphasized the illegality of such practices, highlighting the Central Bank of Nigeria’s (CBN) sole authority in setting exchange rates.

Binance has since removed the Nigerian currency, the naira, from its peer-to-peer (P2P) service as it seeks to address the concerns, The popularity of peer-to-peer (P2P) cryptocurrency trading surged in 2021 after the government, under former President Muhammadu Buhari, implemented a ban on the country’s flourishing crypto industry. This P2P system facilitates direct transactions between buyers and sellers, eliminating the need for a third-party intermediary.

These issues add to the company’s existing legal battles and regulatory hurdles around the world. Notably, throughout 2023, Binance withdrew from several European markets in response to stricter regulations. The Nigerian situation further complicates Binance’s global navigation, raising concerns about its ability to operate in various jurisdictions with evolving regulatory landscapes